Live Free or Move

Forty-three million Americans moved from one state to another between 1995 and 2010 -- about one-seventh of Americans.

It's good that we can move! Moving provides one of the few limits on the megalomania of state bureaucrats.

Americans have moved away from high-taxed, heavily regulated states to lower-taxed, less-regulated states. Most don't think of it as a political decision. They just go where opportunities are, and that usually means where there's less government.

They're leaving my state, New York, in droves. California, despite its great weather, also lost people, and wealth. Other biggest losers were Illinois, New Jersey and Ohio.

Travis Brown, author of "Money Walks," tracked the movements using IRS data. On my TV show, he revealed that Florida was the state that gained the most: "You're seeing a massive amount of people and their income coming in: $86 billion."

Arizona and Texas also gained, which made me wonder if Americans just move to states where it's warm. "No," said Darcy Olsen, president of Arizona's Goldwater Institute. "Weather explains just 5 percent of the migration ... the Census Bureau asks, and they say, 'to find a job.'"

People move where jobs are, and the states gaining the most -- which also include North Carolina and Nevada -- follow what she calls "the magic formula. Lower taxes and good labor policy, which means, to a business, being free to hire and fire the people you want. (In) the most successful states you see both -- no income tax or low taxes coupled with right-to-work laws."

The states that lost the most people and money were New York, California, Illinois, New Jersey and Ohio.

This competition between states makes it possible for states to learn from each other's successes.

T.W. Shannon, speaker of the Oklahoma House of Representatives, told me that he's learned. His state, where the economy had long been sluggish, finally figured out they could spur growth with tax cuts.

"We are moving to reduce our state income tax rate. ... Every time we have done it in the past, we have seen increased revenues and growth." Shannon adds, "Capital won't flow to a hostile environment."

No, it won't. You'd think politicians would figure that out. But they rarely do. Brown's income data shows that capital flows to friendly environments: "States like (Texas, without a state income tax) gained $146 billion, whereas the reverse, the states with the highest among personal income-tax rates, lost over $120 billion."